Pay rises are at their lowest level for three years, with latest increases running at an average of 2.8 per cent, according to a report published this week.
A study of 150 deals in the three months to February showed the lowest figure since March 2003 after a slight fall of 0.1 per cent from January's average.
Pay specialists Industrial Relations Services (IRS) said settlements ranged from 2.4 per cent to 3 per cent, with wage rises in service firms falling below those in manufacturing companies.
Most pay deals were lower than a year ago.
IRS Pay and Benefits editor, Sheila Attwood said: "Our view is that the pay deals concluded in January 2006 mark a turning point, with a downward shift in the level of awards made.
"Despite some concern from other commentators that the tight labour market and higher energy prices will exert upward pressure on wages, our data point to an easing of pay pressure on the back of falling inflation.
"Yet, despite falling pay awards, rises are still comfortably above the rate of headline inflation."
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